ECONOMICS OF SCOPE

ECONOMICS OF SCOPE:-

It occurs when product shares common inputs and diversification leads to cost savings.

As we have discussed in class 

News paper press which works night to print the papers, magazines, articles and many business related news but in the day time the press will work to collect the inputs relating to matter which should print in the night times.

Education institutions which is meant to provide education to the students is the core purpose and during the times of vacation or any other days it is also used for conducting election polling, conducting blood camps, gathering of panchayathi members in the case of rural areas, where it is generating money and thus it leads to cost saving of the institute rentals.

Example:-

• For instance, an individual buys a four wheeler to make his transportation comfort while going to office which he uses only to go and come back to office but over a period of time he feels he can also make money with the same car by registering into ola cabs or uber cabs. Here the individual is generating the money through the same input of car by using it for transportation and by renting it to cab facilities.
• Marriage function halls which are meant to be used only on the marriage seasons. Which are also used to conduct birthday ceremonies, mature functions, get together for college students, politicians meetings, Motivation sessions by education institutions (as i have seen many Chartered Accountant Coaching Centers conducting different sessions for the awareness among CA course and to get admissions). Here the owner of function hall is generating money with the same input of hall by renting it for various purposes.